Highlights
If it wasn't for the shortened Jan. 6 holiday week, news of a big 26,000 plunge in initial jobless claims to a 5-1/2 month low of 299,000 would have improved the outlook for the labor market. As it is, the four-week average probably tells the more accurate story showing a decline of only 1,750 to a still moderate level of 314,750. The Labor Department noted that the holiday week did affect claims though President Ford's funeral, which was a federal holiday, probably had no effect on the results.

Treasuries slipped and the dollar firmed in initial reaction to the data though the results are likely to have little lasting impact through the morning. A similar level in next week's data for the Jan. 13 week, however, would likely have a much greater effect on the jobs outlook and on the markets.